Serbia signs 190 mln euro heat pipeline deal with Powerchina

BELGRADE (Serbia), November 28 (SeeNews) – Serbia's government said it has signed an agreement with Power Construction Corporation of China (Powerchina) for construction of a 28 km-long heat pipeline.

A total of 190 million euro ($226.3 million) will be invested in the construction of the heat pipeline, which will connect Termoelektrane Nikola Tesla (TENT) power plant and Novi Beograd thermal power plant, the government said in a statement late on Monday.

The agreement was signed by Belgrade mayor Sinisa Mali, the director of power utility company Beogradske elektrane, Goran Aleksic, and a representative of Powerchina in the framework of the sixth Meeting of Heads of Government of China-Central and Eastern European Countries (CEEC) initiative, known as the 16+1 mechanism, held in Budapest, Hungary.

On Sunday, the government said it expects the state-owned Beogradske elektrane to cut annual costs by 45 million euro after the heat pipeline enters into service. Beogradske elektrane will be able to repay a loan extended by the Chinese government for the construction of the heat pipeline through the costs saved, energy minister Aleksandar Antic said.

The pipeline will enable Beogradske elektrane to use steam generated at the TENT power plant for production of electricity at the Novi Beograd power plant instead of imported natural gas, Antic said.